Braze(BRZE)2024-12-09 21:06Revenue and Financial Performance - Revenue for the fiscal third quarter 2025 was $152.1 million, up 22.7% year-over-year from $124.0 million in the same quarter of the previous fiscal year[3] - Subscription revenue in the quarter was $146.3 million, compared to $118.4 million in the same quarter of the previous fiscal year[3] - Revenue for the three months ended October 31, 2024, was $152.052 million, a 22.7% increase from $123.956 million in the same period in 2023[25] - Revenue for the nine months ended October 31, 2024, was $433.010 million, a 27.0% increase from $340.843 million in the same period in 2023[25] - Braze provided fiscal Q4 2025 revenue guidance of $155.0 million to $156.0 million and full fiscal year 2025 revenue guidance of $588.0 million to $589.0 million[6] Profit and Loss - GAAP operating loss was $32.6 million, compared to a loss of $35.1 million in the same quarter of the previous fiscal year[3] - Non-GAAP operating loss improved to $2.2 million, compared to a loss of $8.9 million in the same quarter of the previous fiscal year[3] - Net loss for the three months ended October 31, 2024, was $27.911 million, an improvement from a net loss of $30.741 million in the same period in 2023[25] - Net loss for the nine months ended October 31, 2024, was $86.551 million, an improvement from a net loss of $100.889 million in the same period in 2023[25] - GAAP operating loss for Q3 2024 was $32.57 million, compared to $35.13 million in Q3 2023, showing a 7.3% improvement[37] - Non-GAAP operating loss for Q3 2024 was $2.18 million, a significant improvement from $8.90 million in Q3 2023, reflecting a 75.5% reduction[37] - Non-GAAP net income for Q3 2024 was $2.48 million, a significant improvement from a loss of $4.50 million in Q3 2023[37] Gross Profit and Margin - Gross profit for the three months ended October 31, 2024, was $106.142 million, up 21.2% from $87.582 million in the same period in 2023[25] - Gross profit for the nine months ended October 31, 2024, was $299.132 million, up 26.6% from $236.308 million in the same period in 2023[25] - Non-GAAP gross margin improved to 70.5% from 71.4% in the previous year, driven by increased gross profit[36] Customer and Subscription Metrics - Total customers increased to 2,211 as of October 31, 2024, from 2,011 as of October 31, 2023, with 234 customers having ARR of $500,000 or more[3] - Remaining performance obligations as of October 31, 2024, were $716.8 million, with $458.2 million classified as current (less than one year)[3] - Deferred revenue grew from $204.3 million to $223.7 million, indicating strong future revenue commitments[31] Stock-Based Compensation - Total stock-based compensation expense for the three months ended October 31, 2024, was $28.318 million, up 17.8% from $24.039 million in the same period in 2023[26] - Total stock-based compensation expense for the nine months ended October 31, 2024, was $86.418 million, up 18.4% from $72.961 million in the same period in 2023[26] - Total employer taxes related to stock-based compensation for the three months ended October 31, 2024, was $636,000, up 14.2% from $557,000 in the same period in 2023[26] - Total employer taxes related to stock-based compensation for the nine months ended October 31, 2024, was $3.193 million, up 93.5% from $1.650 million in the same period in 2023[26] - Stock-based compensation expense for Q3 2024 was $28.32 million, up 17.8% from $24.04 million in Q3 2023[37] Cash Flow and Investments - Net cash provided by operating activities improved significantly to $19.6 million compared to $3.0 million in the previous year[33] - The company invested $12.1 million in property and equipment and $3.0 million in capitalized internal-use software costs[33] - Net cash used in operating activities for Q3 2024 was $11.41 million, compared to $2.00 million in Q3 2023, indicating increased cash outflow[38] - Non-GAAP free cash flow for Q3 2024 was -$14.25 million, compared to -$5.91 million in Q3 2023, reflecting a 141.1% increase in cash outflow[38] - Capitalized internal-use software costs for Q3 2024 were $0.92 million, slightly up from $0.90 million in Q3 2023[38] - Purchases of property and equipment decreased to $1.92 million in Q3 2024 from $3.01 million in Q3 2023, reflecting a 36.2% reduction[38] Balance Sheet and Liabilities - Total assets increased from $810.9 million to $842.0 million, reflecting growth in marketable securities and property and equipment[31] - Cash and cash equivalents decreased from $68.2 million to $61.3 million, while marketable securities increased from $407.9 million to $431.3 million[31] - Total current liabilities increased from $289.4 million to $308.2 million, primarily due to higher deferred revenue[31] - Accumulated deficit grew from $(483.1) million to $(569.6) million, reflecting ongoing investments in growth[31] Operating Expenses - Research and development expenses increased to $32.9 million, with stock-based compensation accounting for $10.3 million of that total[36] - Sales and marketing expenses rose to $74.7 million, with $9.6 million attributed to stock-based compensation[36] Operating Margin - GAAP operating margin improved to -21.4% in Q3 2024 from -28.3% in Q3 2023, while Non-GAAP operating margin improved to -1.4% from -7.2%[37] Share Metrics - Weighted-average shares used to compute diluted net income per share increased to 106,820 in Q3 2024 from 97,880 in Q3 2023[37] Product and Channel Development - BrazeAI agent, codenamed Project Catalyst, was announced as a new development aimed at delivering 1:1 customer engagement[5] - The company expanded its channel offerings to include LINE and RCS Business, along with new WhatsApp features[5] Future Guidance - Non-GAAP net income for fiscal Q4 2025 is projected to be between $5.0 million and $6.0 million[6]